It is not too late for SMSF trustees who have already lodged their 2017 tax returns to make a choice or an election in relation to capital gains tax (CGT) relief, but only in particular circumstances, according to DBA Lawyers.
DBA Lawyers director Dan Butler told an SMSF online update webinar last Friday that SMSF trustees only have a couple of weeks remaining to make a choice either for a fund that has segregated assets or a fund that has unsegregated assets.
Butler posed a question to his audience about whether it is too late for a fund that has already lodged its 2017 tax return to make a choice in relation to CGT.
“I wanted to put this [question] up because it isn’t that clear and therefore it is really … that depends,” he said.
“If we go to the legislation, it says this: the choice must be an approved form and it can only be made prior to the day by which you are required to lodge that FY 17 return.”
Trustees make a choice in relation to a particular asset within a fund, therefore once the choice is made in relation to a particular asset and the tax return covers that particular asset, it is too late to make a choice on that asset.
“So you cannot go and remake a choice in respect of an asset covered by that return. But you may have lodged that return and lodged it based on certain elections on certain assets,” Butler said.
If trustees discover there are other assets on which they would like to make an election, it is not too late because they have a choice in respect of each asset and each asset is a particular asset for the election, he added.
“So it’s not too late if you want to lodge a choice for assets not covered by the return. So the correct answer there was it depends,” he said.
